Cryptocurrencies Filecoin, BitTorrent Only Survivors As Crypto Markets Lose $120B Overnight

Cryptocurrencies Filecoin, BitTorrent Only Survivors As Crypto Markets Lose $120B Overnight

The total market cap of cryptocurrency markets fell from $1.77 trillion to $1.65 trillion, as over $120 billion left markets overnight.

What Happened: The market-leading cryptocurrency Bitcoin (CRYPTO: BTC) also saw its market cap fall under $1 trillion as its price fell to a low of $52,262 earlier today.

As the market-wide correction deepened, Filecoin (CRYPTO:CFIL) and BitTorrent (CRYPTO: BTT) were the only large-cap coins that recorded some positive price action.

Filecoin, which is a decentralized storage system blockchain, announced an integration with decentralized oracle solution Chainlink (LINK) to connect it with Ethereum and other smart contract compatible blockchains.

FIL was up 12% in the past 24-hours, reaching a high of $94.62 – a level only seen after the token was launched in October 2020.

Bit Torrent Token (BTT) also recorded an overnight gain of 4.5%, continuing its weekly rally that saw the token gain 110% in seven days. At the time of writing, BTT was trading at $0.003387.

The project said on Twitter that the number of BTT miners on the network had grown exponentially over the past few days to reach a new all-time high.

Why It Matters: Most coins recording losses overnight instilled fear across crypto markets, leading to many market participants' panic selling. Some traders, however, viewed the correction as healthy and said that it would give rise to another leg up.

As long as the total market capitalization for #crypto remains above $1.5 trillion, this one is still very bullish and on the road to $2 trillion. pic.twitter.com/Xt0OPta1OJ — Michaël van de Poppe (@CryptoMichNL) March 25, 2021

According to one crypto trader, as long as the overall crypto market cap remained above a critical support level of $1.5 trillion, the outcome would still be bullish.

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UK tax authority to publish new guidance on crypto next week

HM Revenue & Customs, the United Kingdom’s tax authority, will publish new guidance on cryptocurrency taxation next week.

The update, due March 30, will consolidate two existing pieces of guidance on crypto tax into a single “crypto manual”, according to people with knowledge of the situation. They said the move is an attempt to “future proof” further guidance, which they said could be updated multiple times over the next year.

The same sources expect fresh guidance from the taxman on yield earned by lending out cryptocurrencies – which startups like BlockFi have made increasingly popular – and on staking, through which crypto holders earn rewards for helping to maintain proof-of-stake blockchains.

In a statement sent to The Block, a spokesperson for HMRC confirmed it would soon be publishing “a new internal manual” containing guidance on crypto tax.

“The guidance manual demonstrates our commitment to providing clarity to our customers and will help individuals and businesses understand the tax consequences of different types of transactions in crypto assets. This builds on the previously published policy papers and will provide a more flexible approach to updating customers in this fast-moving sector,” they added.

To date, HMRC has published two separate documents offering advice on crypto taxation on its website – one for individuals and the other for businesses. The guidance was last updated in December 2019.

Nimesh Shah, CEO of tax consultancy Blick Rothenberg, told The Block that the thrust of the most recent guidance was “for the majority of people, gains on cryptocurrencies are going to be treated as capital gains” – a rate of 20%. Those actively trading cryptocurrencies, however, would be subject to income tax at the higher rate of 40% or 45%.

HMRC’s 2019 guidance also stated that individuals would be liable to pay income tax and national insurance contributions on crypto received from an employer as a form of payment or through mining, transaction confirmation or airdrops.

The crypto sector has changed significantly since then.

One area insiders expect to be addressed in the coming months is decentralized finance, a market that has grown significantly over the past year. DeFi Pulse, an analytics site, shows the value of the DeFi space has grown from roughly $650 million this time last year to around $40 billion today.

In addition to the rise of DeFi and, even more recently, non-fungible tokens (NFTs), prices in the crypto sector have soared over the past six months – with bitcoin hitting all-time highs of approximately $60,000 in early March.

Good News For Crypto Startups? Coinbase Hiring In India; Govt Seeks Cryptocurrency Disclosures From Companies

While the Indian government is yet to clear the air around its stance on cryptocurrency, the crypto industry is still optimistic about there being no official ban on crypto trading and investments in the country. One of the world’s leading cryptocurrency exchanges Coinbase is looking to set up shop in India, while in an unrelated matter, the government has mandated that companies disclose their cryptocurrency investments in annual filings. Both these developments have given crypto startups and investors hope that a complete ban may not be on the cards for cryptocurrencies in India.

“By housing some IT services, including engineering, software development and customer support operations in India, we will benefit from its huge pool of world-class engineering talent,” Coinbase wrote in a blog post. While the company is starting with remote-first operations, it intends to open an office in Hyderabad and possibly other locations for Indian employees as and when the situation around Covid improves.

Coinbase, which was founded in 2012, is currently in the process of listing itself in US exchanges. The exchange supports cryptocurrencies like Bitcoins and Ethereum, and claims to have over 43 Mn users. The company has also posted job openings on LinkedIn to hire for positions ranging from backend engineers, engineering managers, staff software engineers to product managers.

Besides looking to start operations in India, the company has also backed Indian startups. Coinbase’s investment arm Coinbase Ventures invested in Indian cryptocurrency exchange CoinDCX’s $13.5 Mn Series B round in December last year.

India Seeks Cryptocurrency Disclosures From Companies